Finance of America news for Tuesday includes an initial public offering (IPO) through special purpose acquisition company (SPAC) Replay Acquisition (NYSE:RPLA).
Here’s what potential investors need to know about the SPAC news.
- Finance of America will become a publicly-traded company by merging with Replay Acquisition.
- This plan values the lending company at $1.9 billion.
- The transaction already has $250 million in confirmed support from investors via a private investment in public equity (PIPE) of $10 per share.
- Cash proceeds for the new company include that PIPE funding and $288 million of cash in trust belonging to Replay Acquisition.
- This should allow the company to begin public operations with a minimum of $250 million in cash and cash equivalents.
- One thing worth noting about this SPAC news is the support from Blackstone Tactical Opportunities.
- This is a subsidiary of Blackstone Group (NYSE:BX).
- The Blackstone subsidiary, Replay Acquisition’s public shareholders and management, and entities managed by Finance of America’s founder, will control 70% of the combined company.
- Another thing to note is that more than “half of the sponsor’s founder shares of Replay Acquisition will be deferred and subject to share price hurdles.”
- The deal has the unanimous support of both companies’ Boards of Directors.
- It still needs to complete customary closing conditions.
- That includes getting approval from RPLA shareholders and regulators.
- So long as there are no issues, the deal is set to close in the first half of 2021.
There’s been an increase in SPAC IPOs in the news of late as more companies embrace the method of going public. While there were 59 SPAC IPOs in 2019, 2020 has already seen 138 take place.
RPLA stock was down almost 1% as of Tuesday morning.
On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article.